Information for suppliers

Economic Action Plan 2015 Committed to Introduce a New Government-Wide Integrity Regime

The Government will take action by introducing a new government-wide integrity regime for its procurement and real property transactions to ensure that it does business with ethical suppliers in Canada and abroad.

The new regime will be transparent, rigorous and consistent with best practices in Canada and abroad.

It will also foster ethical business practices, ensure due process and uphold the public trust.

New Integrity Regime

Protects the integrity of procurement and real property transactions by ensuring that these transactions are carried out with ethical suppliers.

Applies to all government departments and agencies. It will hold companies accountable for their actions, but it will also encourage them to cooperate with legal authorities when problems arise and to quickly take corrective actions.

Aligns with international best practices and includes new provisions to ensure fairness and due process.  For example, Canadian companies will no longer be automatically penalized for actions taken by affiliates in other countries in which they had no involvement.

Provides for new tools such as independent expert third party assessments, and administrative agreements that will specify required corrective actions and ensure their effectiveness.


Suppliers are ineligible to contract with the government for 10 years if convicted or absolutely /conditionally discharged of a listed offence in Canada, or a similar offence in a foreign jurisdiction, in the last 3 years. The ineligible period commences on the date of determination.

  • Listed offences include:
    • payment of a contingency fee to a person to whom the Lobbying Act applies;
    • corruption, collusion, bid-rigging or any other anti-competitive activity under the Competition Act;
    • money laundering;
    • participation in activities of criminal organizations;
    • income and excise tax evasion;
    • bribing a foreign public official;
    • offences in relation to drug trafficking;
    • extortion;
    • bribery of judicial officers;
    • bribery of officers;
    • secret commissions;
    • criminal breach of contracts;
    • fraudulent manipulation of stock exchange transactions;
    • prohibited insider trading;
    • forgery and other offences resembling forgery; and
    • falsification of books and documents.


The regime eliminates mandatory ineligibility of a supplier for the actions of an affiliate (including the parent company) unless there is evidence that the supplier/potential supplier had control over the affiliate.

  • Control, as defined by The Bank Act, is directed, influenced, authorized, assented to, acquiesced in or participated in the commission or omission of the acts or offences that render or rendered the affiliate ineligible to receive a government contract.

Suppliers that are rendered ineligible on the basis of their involvement in the wrongdoing that led to the convictions of affiliates will be able to request an administrative review of this determination.

Foreign Convictions

If a bidder is convicted of a listed or similar offence in a foreign jurisdiction in the last 3 years, they will be rendered ineligible for 10 years.

GoC recognized independent third parties will provide information on foreign convictions, however the GoC makes the final determination of similarity.

Supplier Rehabilitation

Suppliers may apply at any time to reduce their ineligibility period by 5 years.

They must demonstrate that they have:

  • cooperated with law enforcement authorities; or
  • taken positive steps to cleanse itself of the causes of the conduct that led to being rendered ineligible.

Administrative agreement would be required with third party monitoring to ensure compliance.


Prime contractors are required to subcontract only with eligible suppliers.   A prime contractor who knowingly subcontracts with an ineligible subcontractor will be declared ineligible to contract with the GoC for 5 years.

Prime contractors can verify the eligibility of their subcontractors from the public Ineligibility List produced by PWGSC.

Should a supplier require the services of a suspended or ineligible subcontractor, approval from the GoC must be sought by the prime in advance.

Treatment of Existing Contracts after Conviction

If a conviction occurs during a contract, the Government retains the right to terminate a contract or real property agreement for default. Suppliers will be afforded an opportunity to show cause as to why the termination should not be exercised.

If the Government decides to not terminate, an administrative agreement will be required.

The administrative agreement would set out the provisions where the company agrees to take corrective action or other measures may be required to give the GoC assurances of ethical behaviour.


The Public Interest Exception (PIE) will continue to apply in circumstances in which it is necessary to enter into business with a supplier that has been convicted of an offence under the Integrity Regime. Possible circumstances necessary to the public interest could include:

  • no other supplier is capable of performing the contract;
  • an emergency;
  • national security;
  • health and safety; and
  • economic harm.

Contracting Authority has responsibility for invoking a PIE.

An administrative agreement between PWGSC and the supplier is required to exercise additional caution and mitigate risks.

  • Agreement will stipulate the corrective actions and measures that are to be undertaken.

Advanced Determination

A potential supplier may, at any time, proactively disclose wrongdoing and request an advanced determination of eligibility from the Minister of PWGSC.

The new regime will provide incentive for suppliers to come forward prior to contract award by allowing their period of ineligibility to start immediately.

Suppliers can take advantage of provisions to reduce the ineligible period by 5 years.

Bid Certification

A supplier certifies with their bid that they, members of their board of directors, and affiliates have not been charged, convicted or absolutely/conditionally discharged of one of the listed offences or a similar foreign offence in the past 3  years.

  • Mechanism is available to disclose information as part of certification process.

A supplier will be ineligible for a period of 10 years if it provides false or misleading information in its certification.

Permanent Ineligibility

A supplier convicted of the following offences results in permanent ineligibility, unless they are granted a pardon, record suspension, absolute or conditional discharge, to contract with the GoC:

  • Frauds against the government under the Criminal Code; or
  • Frauds against the government under the Financial Administration Act.

This provision remains unchanged from the existing policy.


A supplier may be ineligible to do business with the GoC for up to 18 months if it is charged or admits guilt to one of the listed or similar foreign offences.  This period may be extended if a judicial process is underway.

Alternatively, the GoC may impose an administrative agreement on the supplier to take interim action.

Suspended suppliers are put on the Ineligible List produced by PWGSC.

Administrative Agreements

Administrative agreements provide an incentive for a supplier to improve its business culture and processes while providing a mechanism for the Government to impose additional controls and monitor compliance.

They will stipulate terms and conditions that a supplier must meet to remain eligible to contract with GoC, which may include.

  • remedial measures; compliance program; and reporting requirements.

They will be used in instances where:

  • An ineligible supplier has had their ineligibility period reduced;
  • In lieu of suspending suppliers;
  • A public interest exception was invoked with a ineligible supplier; or
  • A decision is made to continue with an existing contract with a supplier which has become non-compliant with the regime.

Monitoring of the terms of the administrative agreement is conducted by a GoC-recognized third party, paid by the supplier.  If a company does not abide by the terms of an administrative agreement, a lengthened ineligibility period could be imposed.

Third Party Verification and Compliance Monitoring

Independent third parties, recognized by the GoC and paid for by the supplier, will provide to the GoC:

  • Details of foreign convictions (obtaining copies of the judgments or findings and identifying the constitutive elements of the foreign conviction);
  • Evidence regarding the extent to which suppliers/potential suppliers directed, influenced, authorized, assented to, acquiesced in or participated in the commission of offences that would render an affiliate ineligible;
  • Confirmation that suppliers have met the conditions required for a reduced ineligibility period, should they choose to apply for it;
  • Confirmation, at the end of an ineligibility period, that measures have been put in place to address the situation that led to the conviction and ineligibility; and
  • Confirmation and regular reporting on compliance pursuant to administrative agreements.


Upon announcement on July 3, 2015, the new regime will apply to all new solicitations and contracts issued by PWGSC.

PWGSC will contact currently ineligible suppliers and reassess eligibility to bid on new contracts based on the new regime.

In the following months PWGSC will enter into MOUs with other federal departments and agencies to achieve government-wide coverage.